Gov pours beer brouhaha

DENVER  The latest drama in Colorados beer wars could be called The Governor Who Kicked a Hornets Nest.

State legislators dressed down Gov. John Hickenlooper and his deputies Tuesday for intervening in the Capitols multi-year beer wars on the side of craft brewers and restaurants.

Hickenlooper, who made a small fortune in restaurants and microbreweries, said he had no idea has was wading into the extra-special bitter battle when he decided last week to rewrite a rule that would have kept restaurants from selling low-strength beer like Murphys Irish Stout.

But Republicans think the governor knew exactly what he was doing when his administration made the last-minute change that will keep low-strength beers flowing at restaurants and liquor stores for next weeks St. Patricks celebration.

Lobbyists for the convenience and grocery stores were using the rule as leverage to get the Legislature to allow them to sell full-strength beer. They amended a bill last year to require stricter enforcement of laws that are supposed to keep weak and strong beers segregated, with only food stores getting licenses to sell 3.2 beer.

I didnt understand I was kicking a hornets nest, Hickenlooper said. It just seems unnecessarily burdensome to get to where you want to go.

Rep. Larry Liston, R-Colorado Springs, sponsored last years bill that called for the rule changes. He convened a special hearing Tuesday and questioned Colorado Department of Revenue officials over the change.

When we pass legislation and its signed by the governor of Colorado, it has the force of law behind it. When we wake up one day ... and find a law that we have passed has somehow been overturned for whatever reason. If it happens to this law, what law is next? Liston said.

Roxy Huber, head of the revenue department, said she got an assurance from the attorney general that her new, lighter regulation still complies with last years law.

The explanation did not satisfy Grier Bailey of the Colorado Wyoming Petroleum Marketers Association, the trade group for convenience stores.

It looks like theyre hanging their hat on the attorney general because thats the only way they can get by with this subversion of the process, Bailey said.

The original version of the rule would have required brewers to report the alcohol content of their beers to the state. Inspectors would then use the information to make sure the right establishments are selling the proper strength beer.

The Colorado Brewers Guild complained to Huber that the rule was too costly for microbrewers. Hickenlooper echoed the criticism Tuesday, saying alcohol-strength tests can cost $200 a batch.

The new rule is much shorter, merely asserting the Department of Revenues authority to test any beer for its alcohol strength. Regulators have that power already and rarely use it.

Both Huber and Hickenlooper said they changed the rule to cut red tape.

My intent, as Ive been instructed in this administration, is to think about business when you make decisions, Huber said.

Liston said Hubers decision gave special treatment to the craft brewers, when other businesses like convenience stores have to follow the letter of the law on what kind of beer they can sell.

Convenience and grocery stores lost much of their beer business in 2008, when the Legislature allowed liquor stores to stay open on Sunday. The food stores have tried every year since to get a new law to let them sell full-strength beer, but they have never beat the powerful lobby for liquor stores and craft brewers.

Legislators have discussed a new effort this year for the food stores, but no one has introduced a bill yet.

The new rule is temporary, and the department of revenue will conduct a hearing in April to pass a permanent rule.